Measuring Economic Efficiency of Kidney Bean Production using Non-Discretionary Data Envelopment Analysis

Subject Areas : Econometrics and Financial Applications of other Theories (Stochastic Processes, (Stochastic) Partial Differential Equations, Dynamical Systems)

Alireza Khoshroo ¹ , Sanjeet Singh ²

1 - Department of Agricultural Engineering, Faculty of Agriculture, Yasouj University, Yasouj, Iran.
2 - Indian Institute of Management, Lucknow, India

Received: 2020-08-10 Accepted : 2020-12-16 Published : 2021-04-01

Keywords: cost saving, Benchmarking, Finance, DEA,

Abstract :

Efficient use of assets in agriculture is a goal for policy-makers and farmers. Agricultural input resources are scarce therefore optimum use of inputs in different agricultural operations is important. Mathematical programming technique such as data envelopment analysis (DEA) is a well-known approach for estimation efficiency of agricultural DMUs. In this study, efficiency of kidney bean production in twelve provinces of Iran has been studied. Inputs were cost of tillage, planting, cultivation, harvesting and land. Output included total production value of kidney bean. Land cost is a non-controllable variable. Therefore; a non-discretionary DEA approach was applied to estimate efficiency of kidney bean production. The average value of technical efficiency score of kidney bean production was 0.74. Results showed that 58 percent of DMUs were efficient and the rest were inefficient. In optimum condition based on the proposed model, tillage, planting, cultivation and harvesting costs is decreased by 34.48%, 11.92%, 27.87% and 7.27%, respectively, without decreasing kidney bean production level.

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